I think it sounds cute, but the problem would be people to make the puppets and people willing to do it.

And I don't know about the whole fanfic either... it would have to be either general or humor only. I can see people be bitter about certain couplings being favored over others if that would happen. :sweatdrop

I think it would be better to work out scripts and stuff and have a vote on what series to do... so there will be plenty of time for other things to go on. And stuff like that.